Gifted Property and Tax

[NM46664]

My question is simple enough ... my brother and i (brother lives in the uk ) inherited our family home 50/50, which i have been living in for the last 11 years, i want to buy my brothers half ... the house is valued at €200k he is prepared to take €60 instead of €100k ... i presume i will have to get a gifted letter drawn up for the €40k.
Question : .... will i have to pay tax on the €40 k

Thanks Nelson.

 

[Gordon Gekko]

The first €32,500 should be covered by your Group B tax-free threshold, assuming that you haven’t received previous gifts or inheritances from grandparents/aunts/uncles/siblings. Then you’ve the €3,000 Small Gift Exemption. And you’ll be paying €60,000. Personally I’d find a valuer willing to sign-off on €190,000 and pay no tax, albeit with an obligation to submit a return on the basis of breaching 80% of the threshold.

 

[Ciru75]

Your brother may owe capital gains tax too if the value of the house has increased since you inherited it.

 

[NM46664]

thank you kindly for taking the time to answer my question, on the point of my brother paying tax, the house was valued at €105,000 at the time of my mothers death ... so i presume 1/2 is €52.500 along with €3000 gift exemption his tax implications will be very small. And indeed if i was to point out all the faults in the house to valuer we might be able to get the price down to €190,000

 

[Ciru75]

The selling price for capital gains tax purposes will be the market value because he's selling to a connected person. On your figures, that would be roughly €15,000 of CGT.